Third time lucky? Enoch ropes in DA

Finance minister Enoch Godongwana has pulled the DA into direct involvement in redrafting the third version of the National Treasury’s budget following his failure to win approval for the two previous efforts.

DA federal council chair Helen Zille told the Sunday Times this week that deputy finance minister Ashor Sarupen — who is also her deputy on the DA council — was one of two party members heavily involved in the process, along with Mark Burke, who serves on parliament’s standing committee on finance.

“The minister’s revised budget is currently in the process of reformulation,” Zille said. “He is involving the DA, primarily through ... Ashor Sarupen and Mark Burke.”

Zille said the DA’s focus in revising the budget was to find ways to cut state spending, and the party was not linking the process with its demands on other issues such as National Health Insurance and the Expropriation Act.

“We do not talk about red lines. We are aiming at a balanced budget which will involve cutting some items of expenditure that do not add value.”

We do not talk about red lines. We are aiming at a balanced budget which will involve cutting some items of expenditure that do not add value

—  Helen Zille, DA federal council chair

Godongwana is scheduled to present a revised budget on May 21 after his two previous budgets, the first on February 19 and the second on March 12, were rejected by the DA, its main partner in the government of national unity (GNU), and several other parties including the EFF.

The first budget, which proposed raising VAT by two percentage points (pp), was even rejected by some of Godongwana’s colleagues in the ANC. The second version compromised by reducing the VAT hike to two increases of 0.5pp over two years, but the DA and the EFF rejected this too.

The finance minister had proposed the VAT increases as a way of raising R75bn to narrow the gap between what the government spends and what it brings in.

Another prominent DA figure, who spoke on condition of anonymity, said the party would not support any attempt to introduce new taxes to close the budget hole.

After Godongwana tables his revised budget, parliament’s finance committee will present its report on his fiscal framework and revenue proposals three weeks later.

The finance committee’s report will require a majority vote in parliament for the budget to be approved.

The second version of the fiscal framework was approved last month by a slim margin of 194 to 182. MPs from the DA, EFF and MK Party were among those who voted “no”.

The DA sought a court order to halt implementation of the new VAT rate, scheduled for May 1. Godongwana reached an out-of-court settlement with the party to halt the tax increase.

Addressing the state of the GNU generally, Zille said the DA and the ANC had agreed to hold regular meetings to try to ensure the survival of the power-sharing accord.

At the height of the budget impasse, ANC secretary-general Fikile Mbalula said there was a need to “reset the rules of engagement” in the GNU, while Deputy President Paul Mashatile argued the DA had “defined itself outside government” by voting against the budget.

Zille said there was no need to tinker with the GNU’s terms of engagement, which were set out when it was formed after the May elections last year.

“We have our rules of engagement. They were set out in the statement of intent. We just need to respect them, not reformulate them. The DA has done so, the ANC has not,” Zille said.

She said the DA was unhappy that in trying to push its second version of the budget through, the ANC had lobbied parties outside the GNU for support.

“The ANC was entirely wrong to seek to build a majority outside the GNU," Zille said. "But we still pushed them back. They need us to make the GNU work and this the best way of restoring the balance.”